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600,000 British Workers Fell Off Payroll Between March and May

New figures show how deeply the UK’s employment situation has been affected by the lockdown. With payroll numbers dipping by 600,000 workers, there are fears over how high the unemployment rate could climb. Some critics of the lockdown measures suggest that the 2-metre distancing rule needs to be relaxed or it will lead to further, substantial job losses.

A Look at the Numbers

The 600,000 figure comes from the Office for National Statistics and covers the period between the lockdown beginning in March and the end of May, when the total number of paid staff fell by 2.1%.

Other figures show benefits claims also rocketed over that period. Universal Credit claims by jobless workers rose by 1.6 million, representing an increase of over 125%.

The number of vacancies was also heavily affected, with 342,000 fewer jobs advertised between March and May than in the previous quarter. This was an even bigger fall than happened following the credit crunch.

Official numbers show a 0.8% drop in employment levels in April and a 0.1% month on month rise in the jobless rate. Perhaps the most startling statistic was a 94 million drop in the total numbers of hours worked per week. The total number of people who didn’t go to work from March through to April increased by 6 million. This figure includes those who entered the furlough scheme at that time.

The total cost of the furlough scheme is now said to have topped £20 billion. With over 9 million workers on the scheme, HR Revenue and Customers confirmed that the cost as of 14 June had reached £20.8 billion.

This news comes after it was revealed that another 200,000 had been furloughed, taking the total number of jobs covered in this way to 9.1 million. The use of the debt collection process has allowed some companies the extra breathing space needed to get through this period.

As for the self-employed support element, this has seen 2.6 million claims totalling a value of £7.6 billion. It is feared that these schemes will eventually cost a combined total of over £100 billion.

What Happens Next?

One of the main concerns is that the Government’s furlough scheme could be temporarily hiding the true extent of the damage that has been done to the UK’s economy. Some analysts believe that the country could reach 1980s levels of unemployment by the time 2020 ends.

One of the immediate reactions to these figures was a call for social distancing rules to be relaxed, with Lord William Hague leading the calls for this. He said that abandoning the 2-metre rule is now necessary, with testing on a “massive scale” needed to allow this to happen.

It is feared that this could be the UK’s worst recession in 3 centuries, as the GDP fell by a fifth in April. However, as the furlough scheme starts to wind down, it is thought that the full extent of the damage done to the economy will not be seen until August.